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Archive for April, 2023

In addition to the details previously provided, some interesting insights from Envoi, agent for United Oil and Gas, follow:

  • Only 11 exploration wells have ever been drilled in the entire country (comprising an area of around 258,137 kmincluding all the offshore areas), all between 1955 and 1982
  • Hydrocarbon shows were observed in all but one of these wells despite not having tested valid structures, as is evident on the latest data
  • Just 2 of the 11 wells were drilled offshore
  • Extensive onshore fieldwork and seep analysis studies have confirmed mature Eocene and Cretaceous oil-prone source rock potential, with migrated oil identified in onshore wells and outcrop samples. These include Late Cretaceous (Cenomanian-Turonian) aged organic shales exhibiting total organic carbon (TOC) up to 8% with maturity.
  • Modelling also suggests significant oil potential exists in mature Cretaceous source kitchens in both the Walton and Morant basins while shallower Palaeogene shales with TOCs up to 15% could also locally be deep enough to be mature.
  • An independent Prospective Resources Audit completed by Gaffney Cline & Associates in December 2020 estimates that just 11 of the total 21 prospects & leads defined to date contain a combined total unrisked mean prospective recoverable resources in excess of 2.4 Billion STOOIP (stock-tank oil initially in place). Of this, 406 MMbbls is attributable to the Colibri Prospect alone, with an upside of 966 MMbbls STOOIP.
  • United is offering a material interest and potential operatorship to suitably qualified parties in the license in return for a commitment to fund a well to test the Colibri Prospect before January 2026, which would fulfill the obligations for the current Second Exploration Period of the Licence.

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Sharing this touching tribute to the 11 men who died on the Deepwater Horizon on April 20, 2010. These American heroes gave their lives exploring for energy to power our economy. The video is introduced by singer Trace Atkins, a former Gulf of Mexico rig worker. Please take a moment to watch.

Other Macondo posts.

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BOE continues to call for an International Offshore Safety Day each year on April 20th.

Proposal: Let’s make April 20th International Offshore Safety Day to honor those who have been killed or injured, to recognize the many workers who provide energy for our economies and way of life, and to encourage safety leadership by all offshore operators, contractors, and service companies.

BOE

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With the announcement of first oil at Argos, 3 of the 5 next generation deepwater platforms (simpler, safer, and greener) are now producing oil and gas in the Gulf of Mexico. The other 2 platforms are expected to begin production in 2024.

Prior to the installation of these platforms, the last deepwater platform addition was Shell’s Appomattox in 2018. That gap in deepwater platform installations was the longest since Bullwinkle was installed in 1988.

The 5 new structures will increase the deepwater platform count by 9% from 56 to 61, and in the next few years should account for approximately 1/4 of GoM oil production.

platformoperatorwater
depth
(feet)
first
production
design
production
(boe)
King’s QuayMurphy3725April 2022100,000
VitoShell4000Feb 2023100,000
Argosbp4500April 2023140,000
AnchorChevron50002024 (est.)80,000
WhaleShell86002024 (est.)100,000
Argos

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This comment from Save LBI (Long Beach Island, NJ) on BOEM’s Renewable Energy Modernization Rule (proposed) highlights an important regulatory policy consideration:

Promoting the offshore wind program is a very high BOEM priority. The bureau is charged with deploying 30 gigawatts of offshore wind energy capacity by 2030, which requires extensive advocacy. However, BOEM is also a core regulator for offshore wind projects, and the concern is that their regulatory role could be compromised by their advocacy priorities.

Per Notice to Lessees 2023 N-01, which arguably should have been published for public comment given its regulatory significance, BOEM has retained important responsibilities for wind project development and operations. These include review and approval of construction and operations plans, site assessment plans, and general activities plans. BOEM may also exercise enforcement authority through the issuance of violation notices and the assessment of civil penalties.

BOEM exists because in 2010 the Administration wanted to separate the OCS program’s leasing (sales/advocacy) and safety (regulatory/enforcement) functions. The intent was to avoid conflicting missions (or the appearance thereof) in the post-Macondo era. (More on this in an upcoming post.)

Ironically, the Save LBI comment describes BSEE as “a distinct unit within BOEM.” That may seem to be the case, but BSEE is actually a separate bureau in the Department of the Interior.

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4/17/2023 NTSB data base search results:

Preliminary report

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A big step forward:

The Department of Energy approved Alaska Gasline Development Corp’s (AGDC) exports of LNG from the project to countries with which the United States does not have a free trade agreement.

Backers of the roughly $39 billion project hope it will be operational by 2030 if it gets investments and all required permits. The LNG would be exported mainly to countries in Asia.

Reuters

53 years of history in 93 seconds:

The basics:

Alaska LNG

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This picture was posted by MaritmePhoto. The”Blue Marlin” heavy lift vessel is arriving in Texas (2005) with the massive semisubmersible production platform “Thunder Horse” on board.

Above (from BOE archives): Pre-commissioning inspection of Thunder Horse

Thunder Horse has a most interesting history. The project was initially named Crazy Horse, but the name was changed out of respect for concerns raised by the Lakota nation. The massive structure is 136 m in length and 113 m in width, and is located in 6300′ of water in the Mississippi Canyon area of the Gulf of Mexico.

Many of you no doubt remember the near disaster during Hurricane Dennis (2005) when the platform was being commissioned. In light of the extensive pre-production hype for the “world’s largest production platform,” this was a costly and embarrassing incident for BP and the OCS program.

Per the findings of the MMS investigation team led by my former colleague David Dykes:

Findings indicate that failures associated with the hydraulic control system and its isolation on evacuation led to the partial opening of multiple hydraulically actuated valves in the ballast and bilge systems of the vessel. This allowed ballast water migration to take place, causing the initial listing (to approximately 16 degrees) of the vessel shortly after the hydraulic system was isolated.

The findings also indicate that ballast water migrated into manned spaces in the lower hull, via faulty and improperly installed check valves in the integrated ballast/bilge piping system. As the degree of list increased beyond the 16 degree mark, downflooding of seawater occurred, initially through overboard discharge lines and/or vents, and possibly later through the deck box as it entered the water. Since the PDQ was already listing at a 16 degree angle prior to the passage of Hurricane Dennis, wave action associated with the passage of the hurricane may also have contributed to the downflooding of seawater.

Although not an initiating event, failed Multiple Cable Transits (MCTs) and two unintended openings in the bulkheads allowed water transfer between watertight compartments, which led to extensive flooding and water damage in the lower hull.

Fortunately, there were no injuries. Repairs were made and production was finally initiated in June 2008.

After recent subsea tieback expansions, Thunder Horse is reported to be producing 200,000+ boe/d. OPEC’s Monthly Market Report for April 2023 cites the Thunder Horse expansion as a key driver in the January 2023 GoM production increase (see excerpt below).

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After 12 consecutive weeks at the 371.6 million barrel level, the SPR has declined another 2 million barrels to 369.6 million barrels as of 4/7/2022. The SPR is now at its lowest level since 11/11/1983 when the reserve was still being filled.

Keep in mind that the SPR deficit is now 357 million barrels, and the maximum refill rate is only 685,000 bopd. So a complete refill at the maximum rate would require 521 days plus acquisition, operational, and maintenance delays. Filling the reserve to its 727 million barrel capacity was a 28 year process.

DOE management nonetheless seems maddingly unconcerned.

DOE comments on the SPR refill.

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On 12/14/2022 I posted that California North Floating LLC was a subsidiary of Copenhagen Infrastructure Partners (CIP), and RWE Offshore Wind Holdings, LLC, a German multinational energy company. Andrew Doba, Director of Communications, has informed me that California North Floating is owned solely by CIP, and is not affiliated with RWE in any way. That post has been updated. Many thanks to Andrew for the correction.

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